You can now read 10 articles in a month for free on BostonGlobe.com. Read as much as you want anywhere and anytime for just 99¢.

The Boston Globe

Business

Amid gentrification, affordable units built in Chinatown

After a long struggle and with a complex financing deal, a rebuilt Hong Lok House begins taking shape for lower-income residents

Jimmy Winningham (left) and Ski DiAngelis worked to finish painting the new housing units on Essex Street in Chinatown.

Josh Reynolds for The Boston Globe

Jimmy Winningham (left) and Ski DiAngelis worked to finish painting the new housing units on Essex Street in Chinatown.

The redevelopment of Hong Lok House in Chinatown is among the most unusual housing projects in Boston. But its most striking feature is not its rooftop garden or the carefully restored woodwork on its facade.

It is the fact that the apartments will rent for less than $500 a month.

Continue reading below

The $35 million project accomplishes the rare feat of expanding affordable housing in Chinatown at a time when luxury high-rises are popping up across the neighborhood, bringing an influx of wealthier renters.

Completion of the first phase next month will create 32 units for low-income elderly residents, who will move from the old Hong Lok building to a new one next door. The original building, which has fallen into disrepair, will be demolished to make way for another 42 units by spring 2014.

Perhaps more noteworthy than the project’s recent progress is the decadelong struggle to get it financed, which underscores the extreme difficulty of keeping housing in city neighborhoods affordable to a diverse population.

Three facades conceal a building that houses newly built Hong Lok housing units.

JOSH REYNOLDS FOR THE BOSTON GLOBE

Three facades conceal a building that houses newly built Hong Lok housing units.

“To create a site in Boston where you can maintain affordable housing is almost an impossibility today,” said James Seagle, president of Rogerson Communities, Hong Lok’s nonprofit developer. “What’s happening for people of lesser means is that the rents are going up, and the properties where they can obtain housing are steadily going away.”

He said the project involved a decade of legal and financial engineering that generated a three-foot sheaf of closing papers; in contrast, Rogerson’s first project 30 years ago, the 75-unit Farnsworth House in Jamaica Plain, took only 18 months and produced a slim 1½-inch binder for the closing papers.

Behind the struggle is a dramatic drop in federal funding for new affordable housing.

Over the past decade, Boston’s allocation of community development block grant money has plummeted nearly 40 percent, to $15.3 million this year, and so-called Home funding has dropped 60 percent, to just $3.55 million, according to city records.

A separate US Housing and Urban Development program for low-income seniors has also been slashed about 50 percent.

That forces developers of affordable housing to rely more heavily on private lending and gifts from institutions.

In the case of Hong Lok, developers tapped a complex patchwork of 23 funding sources, including a $17 million loan from Boston Private Bank & Trust Co., a $2 million gift from State Street Corp., and $1.4 million from the Charles H. Farnsworth Trust.

That was on top of millions of dollars provided by the state Department of Housing and Community Development and multiple city agencies.

“It used to be that you’d have three or four sources of funding; now it’s 10 or 12 and sometimes even more than that,” said Boston Mayor Thomas M. Menino. “Too many people are being forced to leave Chinatown, and this housing will create more possibilities for people who want to stay there.”

One of the few counterweights to gentrification in Chinatown and other neighborhoods is a Menino-created regulation that requires developers either to dedicate 13 percent of units in their projects for affordable housing on site, or pay into a city fund to help get those units built elsewhere.

But that program alone is unable to keep up with the demand. When Hong Lok opens, for example, it will have a three- to five-year backlog of applications from people trying to get a unit. The complex will have an attractive mix of comforts, including a rooftop garden, a community center for seniors, and an expanded adult day health program.

“I don’t even want to think about it,” Ruth Moy, executive director of the Greater Boston Chinese Golden Age Center, said when asked about the demand. “We have a very long waiting list of people who want to stay in this neighborhood. But how long can they wait for affordable housing?”

Moy, who initiated the effort to open the original Hong Lok in the late 1970s, already knows from experience that the wait will be too long, forcing longtime residents to move in with children or seek housing in other communities.

She began working to rehabilitate and expand Hong Lok in the early 2000s. The effort started in concert with the development of hundreds of new luxury housing units by Archstone and other developers.

Moy sought and eventually received financial commitments from those projects to help rebuild and expand Hong Lok. But the effort ran into an array of permitting and logistical snags.

“To weave a path that got us to consensus was very difficult and very expensive,” said Jeffrey Sacks, an attorney with the firm Nixon Peabody who represents the Hong Lok project.

Seagle, Rogerson’s president, said the project was the most difficult of his 40-year career.

In addition to the permitting complexities, the money came in dribs and drabs — a series of $1 million chunks from state programs, $64,000 from Liberty Mutual Insurance Co., $250,000 from Tufts Medical Center, and $5,000 from Cathay Bank, among others.

“The city is building as much affordable housing as it can, but it’s also important to protect the integrity of the Chinese community as much as we can,” he said. “This project won’t do everything, but it will help.”

Casey Ross can be reached at cross@globe.com.
Loading comments...

You have reached the limit of 10 free articles in a month

Stay informed with unlimited access to Boston’s trusted news source.

  • High-quality journalism from the region’s largest newsroom
  • Convenient access across all of your devices
  • Today’s Headlines daily newsletter
  • Subscriber-only access to exclusive offers, events, contests, eBooks, and more
  • Less than 25¢ a week